Brands fade out in Second Life

FOR the past 18 months there has been a growing buzz about the
amazing virtual world of Second Life. The site offers the chance to
create an alternative identity (known as an avatar), and hang out
in a virtual world on the internet with other global citizens and
interact in a variety of ways.

With Second Life claiming that more than 8 million people have
spent time on the site, it was inevitable it would become more
commercial. A host of big-name international brands have now set up
a presence on Second Life.

The first was US retailer American Apparel. The store sold
virtual clothing designed to be worn by the avatars that populate
Second Life. Other brands soon followed. In October, Starwood,
owner of hotel brands such as Westin and Sheraton, premiered its
Aloft hotel brand on Second Life. Starwood saw its virtual hotel as
a way of generating customer insights about its venture long before
any of the hotels opened.

A month later, US car maker Pontiac launched Motorati Island.
According to Pontiac marketing director Mark-Hans Richer, it was
designed to "empower the car community in Second Life and develop
with them in a unique and meaningful manner".

From April, Second Life boasted the ultimate marketing patronage
when Coke launched a "virtual thirst pavilion", where visitors
could compete to create a virtual vending machine selling not Coke,
but, according to the company's website, "the essence of Coca-Cola:
refreshment, joy, unity, experience".

By the middle of this year, some of the most recognised brands
in Australia had moved into Second Life  Intel, adidas, Dell
and Toyota. From media coverage it seemed as if Second Life was the
next marketing frontier, an incredible place where brands could be
built virtually to a global population.

It all sounds amazing, until you visit Second Life. Walking (or
flying) around this virtual universe is a disappointing experience.
The strange, dislocated setting and only the occasional presence of
anyone are disconcerting. The virtual branded locations that
sounded so impressive in the pages of BusinessWeek are basic
and devoid of visitors. Despite Second Life's bold claims of
millions of residents, the limited server space means locations can
handle only 70 avatars at a time. But once you leave the congested
entry portal, this is hardly a problem as most of the site is
eerily quiet and deserted.

In the past month, several of the big brands that trumpeted
their arrival on the site are quietly backing away. The lack of
visitors or any sound strategic rationale for being there have
begun to affect many of them. American Apparel has all but given up
on its virtual store, citing the criticism it has received and
"insignificant" sales. Starwood is also set to leave the site. Only
Coca-Cola is bullish about Second Life. Michael Donnelly, the
company's head of interactive marketing, accepts that much of
Second Life is empty, but says: "My job is to invest in things that
have never been done before."

Second Life is an amazing technical feat, but when it comes to
marketing and brand building we must retain a thick edge of
cynicism and rigour. The site might be virtual, but the money being
spent there by brands is real and the logic behind that investment
should be too. Joseph Jaffe, the marketing consultant who helped
Coke enter Second Life, is quick to dismiss traditional marketing
approaches. "This is not about reach," he says. "This is about
connecting. So when people ask, 'Why Second Life?' I ask 'Why
not?'."

But this is exactly the wrong approach. As a marketer (with a
big marketing budget) it is important to remain focused on key
communication objectives and the return on any marketing
investments. The game of marketing might be changing, with a host
of exciting new opportunities such as YouTube and Google, but the
key questions remain the same. Whether you build brands with
virtual stores, online ads or traditional media, you had better be
able to explain why you invested your budget that way. Try doing it
any other way and you are virtually guaranteed to be out of job
 in the real world, at least.

Mark Ritson is associate professor, marketing, at Melbourne
Business School.

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